INNOVATION AND RESILIENCE IN FRAGILE ECONOMIES: A CONCEPTUAL FRAMEWORK FOR SME PERFORMANCE

This paper develops a conceptual framework that links product, process, and market innovation to SME performance, emphasizing their complementarities and the moderating role of organizational resilience. Drawing on the Resource-Based View (RBV) and Dynamic Capabilities Theory (DCT), the study argues that innovation resources alone do not guarantee superior outcomes in fragile economies unless they are orchestrated through resilience.

Resilience is theorized as a multidimensional capability comprising robustness, integrity, redundancy, resourcefulness, and rapidity, which conditions the performance effects of innovation and amplifies the synergies among innovation types. Prior research in emerging markets often examines innovation in isolation or treats resilience as an outcome, leaving unexplored how resilience shapes innovation–performance dynamics.

To prepare for future empirical testing, a pilot study with 30 SMEs was conducted solely for instrument validation, confirming that the proposed measures are reliable and valid. The contribution of this paper is therefore conceptual: it advances theory by repositioning resilience from a passive outcome to an active moderating capability and by theorizing innovation complementarities as a source of performance advantage in volatile environments. The framework provides a foundation for subsequent empirical studies and practical insights for SMEs operating in fragile economies.